In equity markets, returns and market capitalization do not follow a normal distribution. Instead, they exhibit heavy-tailed, right-skewed, power-law characteristics: A very small number of companies account for a very large share of total wealth creation, while many (or even most) companies underperform. At a high level, this is because the potential growth of the biggest companies is "unlimited". A shareholder can make many multiples of their initial investment, while, in the worst case, they have limited liability if a company goes bankrupt and can only lose the amount they initially invested. According to one study , the top ~4% of stocks generate all net long-term wealth creation while the median stock massively underperforms the index. Virtually every investor is familiar with Nvidia
An options strategy that generates additional returns on Nvidia
CNBC Investing5 hrs ago
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